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Definition of Spot
For immediate payment and delivery, as opposed to future payment and delivery.
See Zero curve.
Exchange rate on currency for immediate delivery. Related: forward exchange rate.
Describes the theoretically correct relationship between spot and futures prices.
Interest rate fixed today on a loan that is made today. Related: forward interest rates.
The origination of mortgages by processing applications taken directly from prospective borrowers.
Related: cash markets
The nearest delivery month on a futures contract.
The current marketprice of the actual physical commodity. Also called cash price.
The theoretical yield on a zero-coupon Treasury security.
The current interest rate appropriate for discounting a cash flow of
The graphical depiction of the relationship between the spot rates and maturity.
Exchange rate for an immediate transaction.
The purchase and sale of a foreign currency, commodity, or other item for immediate delivery.
A curve derived from theoretical considerations as applied to the yields of
Packages that involve the exchange of more than two currencies against a base currency at
A process of creating a theoretical spot rate curve , using one yield projection as the basis for
Also called spot markets, these are markets that involve the immediate delivery of a security
The frequent, scheduled counting of a subset of all inventories,
The percentage amount at which bonds sell below their par value. Also the percentage amount at which a currency sells on the forward market below its current rate on the spot market.
Expectations hypothesis theories
Theories of the term structure of interest rates which include the pure
expectations theory of exchange rates
Theory that expected spot exchange rate equals the forward rate.
The equilibrium price for futures contracts. Also called the theoretical futures price, which equals
Annualized percentage difference between spot and forward rates.
A currency trades at a forward discount when its forward price is lower than its spot price.
A currency trades at a forward premium when its forward price is higher than its spot price.
A projection of future interest rates calculated from either the spot rates or the yield curve.
Interest rate parity theorem
Interest rate differential between two countries is equal to the difference
International Fisher effect
States that the interest rate differential between two countries should be an
Normal backwardation theory
Holds that the futures price will be bid down to a level below the expected
Option-adjusted spread (OAS)
1) The spread over an issuer's spot rate curve, developed as a measure of
Philadelphia Stock Exchange (PHLX)
A securities exchange where American and European foreign
1) Amount paid for a bond above the par value.
The difference between spot and forward rates expressed in points, e.g., $0.0001 per pound sterling.
A theory that spot prices at some future date will be equal to today's forward rates.
In the market for Eurodollar deposits and foreign exchange, value date refers to the delivery date
A financial analysis technique that relates key amounts on the income statement and balance sheet to a 100 percent or base figure for the present and previous year.
Zero curve, zero-coupon yield curve
A yield curve for zero-coupon bonds;
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